Texas LLC Company Agreement: A Comprehensive Guide

A Limited Liability Company (LLC) is a popular business structure in Texas, offering liability protection and tax benefits. However, to ensure the success and stability of your LLC, it's essential to have a well-drafted company agreement in place. In this article, we'll delve into the importance of a Texas LLC company agreement, its key components, and provide a sample template for you to use.

A company agreement, also known as an operating agreement, is a document that outlines the ownership, management, and operational structure of your LLC. It serves as a roadmap for your business, outlining the roles and responsibilities of each member, the decision-making process, and the distribution of profits and losses. By having a clear and comprehensive company agreement, you can avoid potential conflicts, ensure compliance with Texas state laws, and protect your personal assets.

Key Components of a Texas LLC Company Agreement:

• Ownership Structure: Define the ownership percentage of each member, including their name, address, and contact information.
• Management Structure: Determine the management style of your LLC, whether it's member-managed or manager-managed, and outline the roles and responsibilities of each manager.
• Decision-Making Process: Establish the process for making decisions, including the voting requirements and the method for resolving disputes.
• Profit and Loss Distribution: Outline the method for distributing profits and losses among members, including the allocation of capital contributions and the distribution of dividends.
• Capital Contributions: Define the capital contributions required from each member, including the amount and type of contribution.
• Dispute Resolution: Establish a process for resolving disputes among members, including mediation, arbitration, or litigation.

Sample Texas LLC Company Agreement Template:

Here's a sample template for a Texas LLC company agreement:

[Company Name]
Company Agreement
Effective Date: [Date]
Parties:
[Member 1 Name] (Member 1)
[Member 2 Name] (Member 2)
Ownership Structure:
Member 1: 60%
Member 2: 40%
Management Structure:
Member-Managed
Decision-Making Process:
Majority Vote
Profit and Loss Distribution:
Equal Distribution
Capital Contributions:
Member 1: $10,000
Member 2: $5,000
Dispute Resolution:
Mediation
By signing below, the parties acknowledge that they have read, understand, and agree to be bound by the terms and conditions of this company agreement.

Signed,
Member 1: [Signature]
Member 2: [Signature]

Conclusion:

A well-drafted Texas LLC company agreement is essential for the success and stability of your business. By outlining the ownership, management, and operational structure of your LLC, you can avoid potential conflicts, ensure compliance with Texas state laws, and protect your personal assets. Use the sample template provided above as a starting point, and consult with an attorney to ensure that your company agreement meets the specific needs of your business.